As we covered in our previous post, what one person considers “wellbeing” will be different from the next. Every individual requires a unique equation to effectively improve their health.

With varying definitions of “wellbeing programs,” it is not always apparent as to whether they offer screenings, lifestyle management, disease management, or some combination. So, while a wellbeing program may tick the box on an employer’s list of work benefits, its actual impact on employee health at large, and on the business’s ROI, is not always easy to see.

How PepsiCo’s program came up short

A 2014 RAND wellness program study assessed PepsiCo’s wellness program, Healthy Living, which offered separate chronic disease management and lifestyle management initiatives.

While the study showed a return of $1.50 for every dollar invested in the program overall (the combined disease management and lifestyle management programs), the individual returns for the separate programs were drastically varied. Disease management showed an ROI of $3.80, while lifestyle management saw an ROI of only $0.50.  

Additionally, while 87% of participating employees were in the lifestyle management program, 87% of the total healthcare cost savings came from the disease management program. Essentially, more employees participated in the lifestyle management program but the disease management program led to the majority of healthcare cost savings.

Furthermore, a 2012 study from the University of Minnesota found no evidence that lifestyle management lowers healthcare costs. The three-year evaluation of the university’s wellness program found that the disease management led to a 1.76 return on investment in the program’s third year.

Personalization based on individual context and circumstance is a key ingredient of a successful wellbeing program. The impact of Pepsico’s program fell short – until it accounted for disease management and utilized a targeted approach catering to those who were already at high-risk.

The 2018 Illinois Workplace Wellness study also reviewed a workplace wellness program, which was available to 3,300 employees at the University of Chicago and at the University of Illinois at Urbana-Champaign. After one year, researchers did not see changes in healthcare costs or employees’ measured health behaviors.

"The lack of first-year cost savings should not be surprising since the study focuses on health screenings and wellness activities such as fitness, stress management [and] smoking cessation for all employees rather than targeted strategies for employees diagnosed with costly chronic conditions," LuAnn Heinen, vice president at the nonprofit National Business Group on Health and director of the group's Institute on Innovation in Workforce Well-Being, explained to SHRM Online.

A personalized approach

We continue to see generic wellbeing programs fail due to their one-size-fits-all approach and lack of personalization to different people based their varied wellbeing needs. And as a result, ROI suffers.

To overcome this, employers must focus on the specific goals of their wellbeing programs. Do you want to deliver an employee benefit that’s suitable for everyone in the company? Or, do you want to generate ROI? This single question is key to determining the correct metric to assess a program.

If you are trying to generate ROI, or affect claims cost, a one-size-fits-all program is not the answer. Achieving ROI will require employers to deliver solutions focused on risk categories that are enhanced by behavior modification and tailored closely to the individual participants.

As the Pepsi study showed, applying a focused solution to a group of people with specific needs is a critical element to any successful wellbeing program. It is also important to understand that if you combine risk stratification with lifestyle programming (sleep, stress, nutrition, exercise) you can do more than simply manage a condition – you can normalize or even reverse those conditions.

So the question is: do you have to be a disease management program to achieve ROI? No – it is possible to blend both together. When employers deliver a focused program that teaches real life skills to incur long-lasting change, they can achieve higher ROI. In fact, the Pepsi study showed a higher ROI when combining both.

This is exactly Zillion’s objective: with our Restore program, members are selected based upon their specific conditions and/or diagnoses. The program is then designed to help those individuals manage their unique wellbeing needs.

In the next blog in our series, we’ll do a deep dive into the idea of stratification and personalization for delivering a successful wellbeing program with a ROI, stay tuned!